Blanco praises efforts to woo steelmaker

(AP Photo/ The Advocate, Arthur D. Lauck)Development Secretary Michael Olivier, left, and Louisiana Gov. Kathleen Blanco answer questions during a news conference, Friday May 11, 2007, held at the State Capitol in Baton Rouge, La., after steelmaker ThyssenKrupp AG announced they chose Alabama over Louisiana for a new $4.2 billion steel plant.

BATON ROUGE, La. -- German steelmaker ThyssenKrupp AG complimented Louisiana as a place to do business, but cited the state's high utility and labor costs in picking Alabama instead as the home of a new plant worth thousands of jobs.

Gov. Kathleen Blanco said she was disappointed by Friday's announcement, but stressed that Louisiana's yearlong, highly publicized courtship of ThyssenKrupp had advertised Louisiana to the world as a business-friendly state. She said she was encouraged that Louisiana was a finalist in the steel mill sweepstakes - beating out 18 other states - despite a lagging hurricane recovery and decades-old reputation for public corruption.

"I believe that the world fully understands now that the old way of doing business in Louisiana is gone forever. It's a new day," Blanco said. "We work and compete on top of the table, not under the table. We can and we will continue to compete at the highest levels."

Blanco said at least five other companies are considering building a plant on the St. James Parish site, along the Mississippi River between Baton Rouge and New Orleans, that the German firm rejected.

The company revealed little about why it preferred Alabama. The company issued a statement saying "decisive factors included logistical considerations of the company's supply chain from Brazil to our projected customers; operating costs such as electricity and labor; and site-specific expenditures." But it gave few details, and it was unclear why Louisiana's labor costs might have compared unfavorably with Alabama's.

Jim Richardson, a Louisiana State University economics professor, said it's nearly impossible to determine why ThyssenKrupp rejected Louisiana, because the company "has no reason to be specific" about its reasons.

"It's difficult for us to know from the outside. I think on the inside, in the governor's office, they certainly know why," Richardson said.

Blanco said electricity costs and the effects of hurricanes Katrina and Rita might have contributed to the decision. She said ThyssenKrupp officials offered few specifics.

Dan Juneau, head of the Louisiana Association of Business and Industry, a pro-business group, said the Blanco administration should perform an assessment -- "an autopsy," he called it -- of the entire negotiation process with ThyssenKrupp, to assess its performance.

"Find out exactly where we were strong, and where we were weak, and try to shore up the areas where we were weak," Juneau said.

Juneau, whose group often clashes with the Blanco administration, was complimentary toward Blanco and Mike Olivier, the governor's economic development chief, who led the effort to lure ThyssenKrupp to Louisiana.

"I don't know that we've ever come this close to getting a major industrial plant. I think there was some professionalism involved in getting this together," Juneau said.

Both states offered financial incentives worth hundreds of millions of dollars; neither state has made public the details of those offers.

Bob Soulliere, president and chief executive officer of ThyssenKrupp Steel and Stainless USA, said Louisiana "made an excellent proposal and demonstrated many important and valuable attributes for business development."

Loren Scott, an economic consultant who prepared a report on the plant proposal for the state, said Alabama benefited from cooperation from Mississippi and Florida - whose officials also pressured ThyssenKrupp to pick Alabama.

"They were able to pull in those delegations to help them out," he said.

Scott said Louisiana has had some recent success in attracting new jobs to the state.

"It's really depressing when you miss something this big," he said, "but it's not like we're striking out left and right."

State Sen. Tom Schedler, R-Mandeville, who accompanied Blanco on a trip to Germany to court the company, said the mill "would have been the biggest thing since the Superdome."

"If there was ever a state that needed a positive announcement, it was Louisiana," he added.